Feargal Quinn (Independent)

I add my voice to the congratulations to the Minister of State. It is great to see him back in the House in this role which, I think, he enjoys. I was impressed by his contribution. One of the reasons I, along with Senator Finucane, asked for this debate is that we have become complacent. We have got to a point where we assume something which has always happened will always happen. Recently when I was in what one could call a Third World country, each time I went into a bedroom there were candles. The reason is they are used to having power failures. We have got so used to assuming that when we press the switch, the light will come on that we have almost forgotten the times that did not happen. In the past, that was not necessarily due to any failure on the part of ESB but perhaps due to strikes or otherwise. Back in the 1940s and 1950s, my father had to buy generators for his business because he could not have run it without them as there were regular power failures. In my business, the supermarket business, we always had to install generators because back in the 1960s and 1970s, there seemed to be regular power failures, I think, generally due to strikes. My point is that we should not assume we will always have power. That point is enhanced a little recently by what happened between Russia and the Ukraine. Senator Kenneally touched on the figures in respect of our dependence on imports to maintain our development.

I welcome the debate and the Minister of State's words, particularly the contingencies being put in place. It is a reminder to keep them to the fore. However, I express my disappointment at how badly our political process deals with long-term problems which do not have immediate political implications. We are reasonably good at responding to short-term concerns as they arise, particularly when there is a feeling that a broad range of the public is agitated about them. If the public is upset about something immediate, we act on it but if it is long-term, we put it on the long finger, and we tend to have very long fingers. We are not good at responding adequately to long-term challenges — to chickens which will come home to roost long after the current Government has given way to its successors. That is a pity not only because the long-term challenges tend to be the really important ones but because they can best be addressed in the long term. If we ignore them until they become immediate crises, it is difficult to do something about them at that stage.

A related problem is that in recent years, we have become worse at seeking our own solutions to problems which face us. If one looks back over the past ten years, it is striking how much of the legislation which has passed through these Houses has been driven by Europe. These days relatively few of our own initiatives are truly home grown. A case in point applies to the subject matter of this debate, energy. In recent years, the most prominent action we have taken in this area has been the establishment of the energy regulator which has been almost totally driven by Europe. We passed that legislation, as we were required to do so by Europe. However, we have not watched it carefully. We have not monitored how effective it has been in achieving its declared objective. If we did that, we would be faced with the question as to whether we are running our energy industry according to the right priorities.

The first two priorities, and perhaps the overriding ones, should be that we should always have enough energy available to meet demand and that energy should be available to the customer at the lowest possible cost. I looked up the Commission for Energy Regulation website and it does not seem that these are the top two priorities. The website states that the Commission for Energy Regulation, CER, is the independent body responsible for regulating and overseeing the liberalisation of Ireland's energy sector.

I wish to touch on the word "liberalisation" because there is a confusion between the end and the means. In general, I am enthusiastic about liberalisation but it is a means to an end and not an end in itself. Too readily we jump to the conclusion that liberalisation will automatically deliver what we want in terms of supply and price. The current threats to our energy supply show how shaky that argument is. Surely it does not matter how liberalised our system is if it ends up not satisfying the national need for power and if the end result is that customers pay more rather than less for electricity.

The airline industry is a good example of where liberalisation was dramatically effective. Some 20 years ago, it cost £239 to go from Dublin to London and, to the best of my knowledge, there were only two airlines on that route. Following liberalisation, we ended up with Ryanair and other airlines and Aer Lingus had to change its rules. We got far more effective airlines and far lower prices. However, that does not necessarily happen. One only needs to look at the energy industry to see that liberalisation on its own does not work miracles if one takes one's eye off the ball. As a nation, we have taken our eye off the ball and assumed liberalisation will achieve what we want.

There is the crazy situation where the Commission for Energy Regulation, in order to promote competition in the market, approves higher prices because it states that without a certain level of profit, one cannot attract new entrants into the market. The whole point of wanting more players in the first place is to achieve lower prices and not higher ones. From the customers' point of view, if a monopoly produces the lowest prices, then that is what serves them best. That usually does not happen, and it certainly did not in the airline industry, which is why the drive to liberalise has been so strong. It makes sense and I approved of the concept of liberalisation because I assumed it would bring down prices. In this case, however, liberalisation, or attempted liberalisation, is having the opposite effect to what we want, that is, taking the public interest into account.

We want lower energy prices but all this pales into insignificance if we do not have energy in the first place. When one's power is cut off, one does not mind what price one must pay for it. All one wants is a restoration of power. That is my starting point in this regard and is why continuity of supply must always be the first national energy priority. It comes before everything else and our entire energy policy should be focused on getting that right before we meddle with anything else.

It is also important to realise that annoying as power cuts may be for the ordinary household customer, they are much more important from a business perspective. Earlier, I spoke of being obliged to install generators in my supermarkets. I know of one American company that wanted to open supermarkets in Asia. It examined the possibility of so doing, decided it was a fantastic opportunity and invested heavily. However, the company failed and lost heavily on the venture. The company's misjudgment was that it did not realise that the power failures which occurred there on a regular basis meant that the business could not be run successfully, particularly in respect of fresh food.

While it is annoying for households to make do without power, Members should consider what would happen to those companies which we have attracted into our country in order to build their businesses. To a large extent, the success of our economy has been built on them. Part of the reason we were able to attract them here was our ability to promise them continuity of supply, as far as electricity was concerned. The lack of a 100% supply would be a deal breaker for such industries.

I have travelled to many countries where daily power interruptions are the norm. One of the characteristics of a Third World country is the uncertainty of its power supply. Up to now, Ireland has avoided this state of affairs so well that many of us take for granted the expectation that the supply of electricity will always be available when desired. However, we are perilously close to changing that situation and turning this country into one in which one cannot always depend on something happening when one turns on a switch.

The manner in which we have organised our energy industry has led us to focus on the wrong priorities and we should revisit the legislation. One point which has emerged from today's contributions is that the Minister should consider revisiting the legislation that set up the Commission for Energy Regulation. He should redefine its remit so that no one is in any doubt that its first priority should be to ensure continuity of supply and that the second should be to deliver the lowest possible prices. Anything else, however desirable, should be subordinate to those two objectives.

I have dealt with the subject of electricity sufficiently. As other Members have noted, its supply is neither the beginning nor the end of our energy needs, important though it is. Our cars and trucks do not run on electricity and represent an ever-increasing part of our energy demand. In the past year, we have had two wake-up calls in this respect. Members have already discussed the first, namely, the rise of the spot oil price to a new plateau. Originally, people did not believe that a price of a barrel of oil could reach $70 or that such a price could be lived with. However, this is no longer a novelty and most people now appear to believe that we will never again see the price of oil fall below $50 dollars a barrel. This is reflected in the fact that according to the latest figures released yesterday, increased oil prices alone accounted for more than €1 billion in our annual imports bill. The sum of €1 billion simply reflects the increase last year over the previous year, as the total oil bill is much higher.

Our second wake-up call, to which we have paid little heed thus far, was the news that this country is the most dependent in Europe on imported energy. This means that in a future in which the price of oil is likely to go in only one direction, we are set to become almost totally dependent on an input, the price and source of which we will have absolutely no control over. Members will have noted the recent events in Ukraine. This will become an increasingly significant element in determining our overall competitiveness on the international scene, as well as our ability to attract business and industry to Ireland to create jobs and boost our economy.

Taken together, these two wake-up calls should spur us into action. They should make us determined to take seriously the question of alternative energy supplies. Developing those alternatives should become an urgent national priority, if we have any sense of the future or any sense of our responsibility to prepare for its needs, rather than simply focusing on our ability to continue to party on, as we do at present.

In recent years we have taken some tentative steps with regard to the development of wind power. It was interesting to travel to Dundalk last week and to see for the first time the production by Dundalk Institute of Technology of its own electricity from its wind generator. Such steps are welcome. Moreover, from my home I can see the wind turbines off the Wicklow coast. While we have taken those first steps, we have almost totally ignored the potential of wave power, despite our favourable position on the edge of the Atlantic ocean. Senator Finucane has already raised this point. I believe we should urgently seek to piggy-back on the research that is being carried out on wave power in, for example, Denmark. Members should note that geographically, it is far less ideally placed than Ireland to exploit its potential. While we do not initiate enough of our own solutions, we can piggy-back on the works of others.

However, the biggest gap in our approach to energy is our refusal to actively explore alternatives to petrol as a fuel for our cars and trucks. There must be alternatives and Members have touched on this issue during this debate. It is not rocket science, as the technology already exists and is fully proven to run vehicles on ethanol rather than on petrol. Nor is there any economic problem in so doing, given the Government's total control over the excise duty charged on fuel. It would be in the national interest to forego completely the revenue from motor fuels if the substitute was a home-grown, renewable product.

The Minister of State mentioned Ireland's rich vein of renewable energy resources. As an agricultural nation, we are particularly well placed to take this step. The farming lobby should be pushing hardest in this respect. Instead of putting all their energy into producing crops that others can produce more efficiently, or in the pursuit of subsidies to compensate themselves for agreeing not to produce anything at all, farmers should rush to embrace this new market opportunity. They have the opportunity to produce something that the marketplace actually wants, at a price that will guarantee them a generous return for their efforts. They must put some work into this and Teagasc and others can help them do so. A side benefit would be that it would allow farmers to reinvent themselves as friends of the environment, rather than as its enemies, as they are so frequently portrayed today.

If we continue depending on oil to the same extent as today, we will fatally undermine our future ability to compete successfully in world markets. We should grow our own petrol instead. It is that simple. This can be done, although it will entail changes of attitudes and will require us to focus our attention on the issue. I welcome both the Minister's comments on this subject and the opportunity to debate it.